Contract of bailment: In a contract of bailment, if goods are lost or damaged while in the possession of the bailee, he will be liable. The burden of proof will be on the bailee to show that he took a reasonable degree of care in respect of the bailed goods.
Nothing comes free. Not even the complimentary services offered by big hotels. The Supreme Court noted in a judgement last week, “…it is common knowledge that ‘complimentary’ services provided by 5-star hotels are not actually free-of-cost. These services are covered by the exorbitant rates charged for renting of rooms, food, entry fee to lounges and clubs, and so on.”
The apex court’s observation came in a case where it examined whether a hotel can be held liable if a customer’s car is stolen after he gives the key to Valet Parking. Read about the judgement here. The apex court also examined whether valet parking offered by hotels can be treated as a contract of bailment, which is defined under Section 148 of The Indian Contract Act.
About the contract of bailment, SC said: “The general rule has been that in a contract of bailment, if goods are lost or damaged while in the possession of the bailee, he will be liable. The burden of proof will be on the bailee to show that he took a reasonable degree of care in respect of the bailed goods. This is because there is an implicit expectation between the hotel and the guest when a vehicle is handed over for valet parking that the vehicle would be taken reasonable care of, and returned in a proper condition. Thus, the failure to return the vehicle strikes at the root of the bailment relationship and gives rise to a prima facie case of negligence against the hotel.”
Nothing is free
Any so-called free service offered by the hotel is for its own benefit, even the valet parking. The top court said, “It cannot be denied that valet parking service, even if offered gratuitously, benefits the hotel.”
The apex court observed: “A hotel holding itself out to the public as providing such a service seeks to pitch it as a value addition to the experience of a guest and incentives greater footfall. In fact, many luxury hotels are located in central urban areas which are prone to congestion, thereby necessitating valet parking to protect guests from overcrowding and pollution caused by haphazard parking of vehicles.
“In such a setting, the provision of valet parking offers the hotel an edge over others, as visitors are generally inclined to accept the invitation of greater convenience furnished by the hotel, i.e. of having someone else park their vehicles in a secure place. Therefore, for such cases, there exists an implied consideration for the contract of bailment created by virtue of the valet parking service.”